ADB sees Philippines still hitting 2019 economic growth target

MANILA, Philippines – The Asian Development Bank (ADB) slashed its growth outlook for the Philippines again, but maintained that it will likely remain within the government's target band.

In a press briefing on Wednesday, September 25, ADB country manager for the Philippines Kelly Bird said the multilateral lender projects that gross domestic product (GDP) would grow at 6% in 2019 and 6.2% in 2020.

This is lower than the previous forecast of 6.2% and 6.4% in 2019 and 2020, respectively.

Year-to-date, GDP growth is still below target at 5.5%. To hit the lower end of the target of 6% to 7%, GDP growth has to hit at least 6.5% in the 3rd and 4th quarters.

The projection takes into account the global economic slowdown and domestic investments.

Bird noted that the slower growth may be due to the Philippine economy entering a phase in its business cycle when growth is expected to temporarily ease.

"Although private consumption continued to expand robustly, it was more than offset by a slowdown in domestic investment and weakening exports," the ADB said in its report.

Moderating economic growth is also seen to be accompanied by lower inflation and narrower current account deficits.

The ADB likewise lowered its growth prospects for 2019 in East Asia (5.5% from 5.7%), Southeast Asia (4.5% from 5.9%), and South Asia (6.2% from 6.8%), amid the lingering trade war between the United States and China. –

Ralf Rivas

A sociologist by heart, a journalist by profession. Ralf is Rappler's business reporter, covering macroeconomy, government finance, companies, and agriculture.